MEDIA: What The Papers Say - 'Cheapserve' sell-off nets mixed reviews

Freeserve CEO John Pluthero tried hard to put a positive gloss on the ISP's acquisition by France Telecom's Wanadoo, but didn't quite succeed.

Against a news background of further turbulence in internet stocks, news of Wanadoo's share deal for Freeserve failed to impress both the media and analysts, prompting The Financial Times to head its Lex column 'Cheapserve' (7/12), and spawning the headline 'Freeserve gloom as it falls to French' in the Daily Express (7/12).

The deal's implications for shareholders also came to the fore, as The Daily Telegraph and others noted that 'every single one of them will have lost money' (7/12). Compounding the misery were The Sun and The Mirror, which highlighted the 'pounds 4m windfall' to be pocketed by Pluthero (7/12).

Despite its downbeat tone, reporting contained ample recognition of the strategic sense of the deal, which will position Freeserve as one of Europe's top three ISPs and provide it with much-needed investment to expand into new service areas.

Analysis and commentary by Echo Research. More information can be found at: www.echoResearch.com.